Temelin tender controversy builds

30 October 2012

Czech utility CEZ has rejected Areva's objections to the disqualification of its bid for the contract to build two new units at the Temelin nuclear power plant. Areva will now take its appeal to the Czech anti-monopoly office.

On 5 October, CEZ told Areva that its bid for the contract for Temelin units 3 and 4 had been disqualified as it "failed to meet statutory requirements" under the Czech Republic's Public Procurement Act and that the company "had not fulfilled some other crucial criteria defined in the tender." On 19 October, Areva "provided detailed objections to each of the reasons for exclusion raised by CEZ."

However, CEZ has now stated that "after carefully assessing each of the grounds" it has decided to reject Areva's appeal. The company noted that it has "precisely and in detail communicated to Areva the grounds why their bid has been excluded; the grounds are crucial and of both commercial and legal nature." While neither company has indicated why Areva's bid has been disqualified, a CEZ spokesman earlier stated that the public may be informed about the specific reasons "only when all options for potential appeals have been used so that the award procedure is conducted in a correct and fair manner."

The French company responded by calling CEZ's decision "baseless" and saying that its offer to supply two EPR units "is compliant with statutory requirements and has been misunderstood in many respects." Areva - which has ten days in which to lodge a petition with the Czech anti-monopoly office, the Office for the Protection of Economic Competition - called for the suspension of the tender process.

Areva CEO Luc Oursel commented: "I deeply regret that Areva is penalized based on matters that have never been discussed between the parties before, without any dialogue or clarification process, both of which are standard in a nuclear industry where transparency dialogue are key."

Areva said it "is now forced to take all legal actions available under Czech and EU laws with the objective of returning to the Temelin 3 and 4 tender process."

CEZ launched the tender process for the new Temelin units in August 2009 and invited three candidates - Areva; a consortium between Škoda JS, AtomStroyExport and OKB Gidropress; and Westinghouse - in November 2011 to submit bids. All three contenders submitted documentation supporting their respective bids in late June 2012. CEZ expects to select the reactor supplier and sign the construction contract by the end of 2013.